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Shipping strategies before, during and after 2008 financial crisis : a critical analysis

Author

Wang, Wenxiu

Date of Issue

2016

School

School of Civil and Environmental Engineering

Abstract

Shipping strategies are plans that are developed intentionally and carefully by the tanker shipping companies in preparation for the foreseeable market volatility. Shipping companies, like many other non-shipping companies, have adopted strategies that exist in three main levels which are corporate, business and functional levels. The performance of the firms, following the implementation of shipping strategies, are then be measured through the use of Balanced Scorecard (Kaplan & Norton, 1992), comprising of both financial and non-financial indicators.
This paper aims to identify the shipping strategies adopted by tanker shipping companies before, during and after the 2008 Financial Crisis. In total, 3 interviewees who are holding managerial positions in their own tanker shipping companies have been interviewed. Through these interviews and annual reports, main shipping strategies which are categorised into corporate, business and functional strategies are consolidated according to different time periods. Comparison shows that big strategic reform has taken place during the different periods of financial crisis. After investigating the financial and non-financial performance of the companies, a direct relationship between adopted shipping strategy and company performance has been drawn.
Aside from 2008 Financial Crisis, strategy-related factors and other external environmental factors are nominated by interviewees as the other determining factors in the relationship between strategy and performance. The result of this research shows that the relationship between shipping strategy and company performance is dynamic as it is influenced by multiple internal and external environmental factors.